Claim Trends From Our Dubai Office
We continue to deal with a variety of losses across the Middle East and Africa, as well as in the Far East. These mainly relate to fraud and crime but we are also seeing credit claims, cyber and PI matters. Here’s some more detail:
- Employee infidelity. This remains the most common type of loss for financial institutions and companies in the region. We often see significant amounts being stolen in a short space of time – the employees then quickly flee to their home countries before their actions are discovered.
- Credit claims. We are dealing with a number of high-profile cases revolving around the collapse of various commodities traders operating out of Dubai and Singapore. These relate to finance that those entities (now in liquidation) had secured from international banks under false pretences.
- Cyber-fraud. This includes a large SWIFT transfer fraud which we handled recently which involved the hacking of the insured’s computer network. These types of fraud will often expose gaps in a banks IT security. We also mention that ascertaining the exact way in which the hackers gained access to systems can be complex.
- SIM swap frauds, where criminals obtain replacement SIM cards for customers’ mobile phones from their mobile providers. The fraudsters then exploit weaknesses in the banks verification processes to approve the transfers of funds away from customer accounts. We have dealt with SIM swap claims involving several UAE banks.
- Forgery losses involving cheques, which are still widely used in the region as well as the forgery of certain types of loan application documents.
- PI claims. We continue to see customer claims against banks and investment managers involving a variety of allegations, including mis-management of investment funds, defective loan guarantees and negligence in opening and managing accounts.
As for the types of claims we anticipate going forward:
- We expect there will be more fraud and crime claims resulting from the global economic downturn.
- Business interruption claims appear likely to increase due to Covid 19.
- Last but certainly not least, cyber criminals will try to exploit the fact that business is moving increasingly online. This will lead to an increase in cyber-crime and liability claims.